Roku Inc. (NASDAQ:ROKU) is showing promising signs of growth as it enhances labor productivity, a key metric in today's competitive streaming industry, according to Needham.
The Roku Analyst: Analyst Laura Martin maintained a Buy rating, while raising the price target from $88 to $100.
The Roku Thesis: The company's total revenues per full-time equivalent (FTE) grew from $921,528 in 2021 to $1.2 million in 2024, Martin said in the note.
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This translates to a 34% growth over the three years, she added.
"Roku had the 3rd highest growth rate in revenue-based labor efficiency among the large cap stocks we cover," behind only Amazon.com Inc (NASDAQ:AMZN) and Meta Platforms Inc (NASDAQ:META), which recorded improvements of 40% and 35%, respectively, the analyst stated.
"We believe that new CFO Dan Jedda, who came to Roku in 2Q23, has been instrumental at driving this improvement, and we expect this positive trajectory to continue," she further wrote.
ROKU Price Action: Shares of Roku had declined by 0.16% to $88.00 at the time of publication on Wednesday.
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